Understanding your financial wellness can open many doors in life. With a good credit score and healthy cash flow, anyone can build wealth that will serve them well over time.
Such is what makes Borrowell an intriguing platform. In addition to offering loans, users also get free Equifax credit monitoring, credit education, and product recommendations from over 50 banks and lenders across the true north. But is Borrowell the best place to shop for a loan? Here’s our Borrowell Loans review for Canada.
Loans, Mortgages and Credit Cards Under One Roof
First and foremost, Borrowell is a lending platform. Once users sign up, they are presented with a number of loans which they may qualify for. The platform offers users credit cards, personal loans, and even mortgages for homes.
The credit card tool works like many others: After signing up and getting your Equifax credit score, Borrowell offers suggestions on which credit cards you may qualify for based on your profile. The website claims they have over 60 cards in their library in many different categories, including cash back, credit building, and travel. A number of Canadian banks, including BMO, Canadian Tire Bank, CapitalOne, and Scotiabank, are represented in the platform.
The mortgage tool works similarly. But instead of being thrown into a number of offers immediately, Borrowell provides the tools for users to understand how their credit affects their pre-qualified mortgage amount and rate. With their current outlook in hand and tips to improve credit, users can compare rates on new mortgages and refinances, giving them shopping tools to find the right option.
While Borrowell goes out to their partners for credit card and mortgages, the platform originates their own personal loans. Although they offer personal loans from over 50 Canadian financial institutions, Borrowell also offers a personal loan of up to $35,000, with a starting interest rate of 5.9%.
How do Borrowell Loans Compare to the Market?
It may come as a surprise that Borrowell – advertised as a financial wellness website that offers credit products – also offers some of the most competitive personal loans across Canada. Their lowest interest rate is two-thirds less than competitors FerratumMoney and ConsumerCapital Canada, making them arguably one of the best options on the marketplace.
However, qualifying for a Borrowell loan isn’t easy. To get the best interest rate possible, users must be Canadian citizens or residents, be at or over the age of consent, and hold a valid chequeing account with a Canadian financial institution.
At the bare minimum, users must have an annual income of $20,000 and a credit score of at least 660. In addition, any bankruptcies or current delinquencies on their credit file may disqualify users from getting a Borrowell loan.
Those who have a full-time job or a strong pension and good to excellent credit should have no problem getting a personal loan at the best rates.
How to Get a Borrowell Loan
Applications for Borrowell loans start on their website. During the process, you will be asked to verify their identity through Equifax and link you bank account via VersaPay. Proof of income can be provided with either your last two paystubs or the Notice of Assessment (NOA) from your last two tax returns.
Once this goes through, Borrowell will review your financial information. Loan considerations include employment history, credit score, available credit, current debt, any bankruptcies or delinquencies, and any changes to your recent NOA.
The best loan terms and rates will be offered to those with excellent credit. If your credit isn’t perfect, that’s okay as well – you may still qualify for a Borrowell loan, although either at a lower amount or at a higher interest rate.
Pros and Cons of a Borrowell Loan
The best advantage to a Borrowell loan is their competitive terms. With annual percentage rates lower than most credit cards, individuals with the best credit who face a sudden bill or other emergency can get a loan with a lower interest rate than most credit cards. Loan terms range from three to five years, and there is no early repayment fee on personal loans. This means you could get a loan, and pay it off in less time than the loan term, saving money on interest payments.
But the devil is in the details, and there are many details you need to keep in mind. In addition to the loan amount, you will be charged a one-time origination fee of up to 5%. For a $35,000 loan (the maximum Borrowell loan), you could face additional charges of $1,750. In addition, Borrowell only accepts monthly loan payments, meaning you can’t break up your payments into weekly or biweekly amounts. If your payment is returned due to insufficient funds in your bank account, you could be charged up to a $54 penalty.
Bottom Line: Should I Get a Borrowell Loan?
For those who qualify with the best credit, Borrowell loans are among the most competitive on the marketplace. It’s free to sign up for Borrowell to see if you could qualify, and comes with the added bonus of a free credit score and credit tracking. Even if your credit isn’t great, the platform offers all the tools you need to improve your position.
Unfortunately, that’s where the buck stops. If you don’t qualify for a Borrowell loan, you could be sent to one of their 60 partners and sold a personal loan with higher interest and longer terms. In these situations, what was advertised as an affordable emergency funding option can come with a whole host of other problems.
In short, users should come to Borrowell for their financial tools to improve credit. But if you don’t have the best credit, stop short of accepting a loan which may have disadvantageous rates and could send you even further into debt.